The is the interest rate that a firm pays on any new debt financing. Blue Hamster Manufacturing (BHM) can borrow funds at an interest rate of 10.20% for a period of eight years. Its marginal federal-plus-state tax rate is 30%. BHM’s after-tax cost of debt is (rounded to two decimal places). At the present time, Blue Hamster Manufacturing (BHM) has a series of ten-year noncallable bonds with a face value of $1,000 that are outstanding. These bonds have a current market price of $1,092.79 per bond, carry a coupon rate of 11%, and distribute annual coupon payments. The company incurs a federal-plus-state tax rate of 30%. If BHM wants to issue new debt, what would be a reasonable estimate for its after-tax cost of debt (rounded to two decimal places)? 5.33% 6.66% 7.99% 7.66%
Answers: 3
Business, 22.06.2019 17:10
Calculate riverside’s financial ratios for 2014. assume that riverside had $1,000,000 in lease payments and $1,400,000 in debt principal repayments in 2014. (hint: use the book discussion to identify the applicable ratios.)
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Business, 22.06.2019 21:50
scenario: hawaii and south carolina are trading partners. hawaii has an absolute advantage in the production of both coffee and tea. the opportunity cost of producing 1 pound of tea in hawaii is 2 pounds of coffee, and the opportunity cost of producing 1 pound of tea in south carolina is 1/3 pound of coffee. which of the following statements is true? a. south carolina should specialize in the production of both tea and coffee. b. hawaii should specialize in the production of tea, whereas south carolina should specialize in the production of coffee. c. hawaii should specialize in the production of coffee, whereas south carolina should specialize in the production of tea. d. hawaii should specialize in the production of both tea and coffee.
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Business, 22.06.2019 22:00
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Business, 22.06.2019 22:50
Which of these makes a student loan different from other types of loans
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The is the interest rate that a firm pays on any new debt financing. Blue Hamster Manufacturing (BHM...
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